Organic premiums are one of the most common reasons farms decide to become certified organic. According Produce business, organic premiums result from differences in input costs between organic and conventional operations. If organic farms cannot use synthetic fertilizers, farmers may need to hire more labor to apply organic manure as fertilizer. And, if a farmer needs to buy land for an organic operation, the farmer can pay more for an area that has not historically been exposed to synthetic chemicals. To top it off, farms have to spend more money to undergo inspections each year. The premium is one of the only ways farmers can recoup the investment in organic farming.
Premiums may vary depending on availability and season. Lettuce has one of the highest average premiums at 10-20% more expensive than conventional lettuce. The erratic supply of produce, however, has affected the stability of premiums for farmers. According to Produce Business, in January 2018, prices for organic clementines, mangoes, and romaine lettuce were 23-54% lower than conventional produce. In the same week, organic navel oranges and red-skinned potatoes were either the same price or up to 7% more expensive than conventionally grown produce.